Today, businesses realize the necessity of having a CFO who can drive digital transformation and…
The Construction sector is no stranger to competition; bidding on potential projects part and parcel of daily activity. But if competing firms’ core competencies are the same (i.e. the same staff skill levels, the same access to sub-contractors, the same experience), how can Construction firms ensure they’re able to stand out from the crowd, win more work and deliver the most cost-effective projects?
As with a building, the core strength of a company lies in the foundations it is built upon, and in today’s digital age the foundations of an organisation are data. Generated by most business activities, yet often overlooked when it comes to decision-making, data can be the key to becoming more competitive, but only with the right tools in place to uncover trends and help future planning. Many firms are realising exactly this, and turning to decision-making software to provide the vital insight needed to analyse, simulate and plan more effectively.
Typically, business decisions are made based on gut feel or without a full view of the potential impact on the business as a whole. Decision-Making Tools unify data analysis, planning, simulation, and forecasting to eliminate this problem, providing insights into the business-wide impact of an action or strategy, enabling managers to make a more-informed decision. The results are often referred to as decisive analytics. Let’s think about this in a Construction sense.
A new project might look appealing on the surface, and you may be likely to win it, but will it turn out to be profitable? While hunches and experience can get you so far, the real truth lies in the numbers. How much of a resource drain was a similar project two years ago? How far over budget did it end up running? How much could a project in that region bring in return?
You could ask the Finance team to manually dig out the records when they get a chance, but a more instant approach, using BI to analyse and cross-reference past projects against certain criteria, will save you time and allow you to react quicker should the tender be custom-made for your capabilities. By using a Decision-Making Platform, you can take this discovery further, utilising the historical data trends to forecast the impact of the new project on your profitability, with varying scenarios, to ensure you’re making the right decision and pricing the job correctly.
You’re likely to have a network of suppliers and sub-contractors who you’ll bring in to help with the delivery of a project. Each of these will bring their own core competencies and benefits, but as with the choice of project itself, the choice of supplier and sub-contractor can greatly affect your timescales and profitability.
By taking the combined decision-making approach to interrogate your historical data you will understand which suppliers and contractors will financially benefit your latest project or be likely to offer the best timescales. Being able to manipulate the figures with a few clicks and see the impact on a variety of KPIs is not to be underestimated.
Do you have enough resources to deliver the build? Will the new project require investment in people? Would it be more economical to hire additional bodies, upskill existing employees or outsource certain aspects completely? Utilising forward-planning scenarios can help you understand the impact on the project’s profitability of these and many other human resource related factors in minutes – another way to speed up the decision-making process and pip your competitors to the post.
Finance teams in industries across the world are swimming in spreadsheets and chances are your colleagues are the same. Spreadsheets bring the risk of erroneous data, broken formulas and a great deal of difficulty in consolidating or comparing multiple sources of data. Increase efficiencies and free up Finance’s time for more value-added activities through a unified tool that automates those repetitive, manual processes. More productive and motivated staff means a more responsive and competitive organisation.
Spreadsheets aren’t the only culprit of wasted time and money. Disjointed, legacy systems can require lots of consultancy to make even the simplest of changes, and lots of modules can bump up your annual support contract by thousands. Even then, the time wasted in exporting and importing data for comparison is great – or you end up back with those (un)trustworthy spreadsheets again. By opting for a more modern, unified solution with one license structure, the total cost of ownership is greatly reduced and the payoff in the long term will be huge.
Of course this is not an exhaustive list, but the sentiment is clear. Decision-Making Platforms create a strong foundation on which to base business decisions, helping you to improve efficiency and effectiveness. After all, is gut feel really a sustainable source of competitive advantage?
To find out more about the benefits of Decision-Making Platforms for Finance teams, download our free guide, produced in conjunction with CFO.com: How Decision-Making Platforms Transform Financial Reporting & FP&A.
Download the CFO.com report to learn more about the benefits of Decision-Making Platforms.